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Area Development - Site Selection, Facility Planning and Workforce Development

Editor’s Note: About Those Manufacturing Jobs…

Directory 2017
Now that the presidential election results have been certified, both economic analysts and corporate executives are trying to figure out what to expect under the new Trump administration. If Trump follows through on his campaign promises of spending on infrastructure and revising personal and corporate taxes, as well as deregulation moves, the Organization for Economic Cooperation and Development (OECD) projects the U.S. economy will grow 2.3 percent in 2017 and 3 percent in 2018.

According to the organization’s late November report, “In the aftermath of the U.S. elections, there is widespread expectation of a significant change in direction of macroeconomic policy.” The group’s chief economist, Catherine Mann, does warn that Trump’s anti-trade proposals could have negative consequences: “Protectionism and the inevitable trade retaliation would offset much of the positive effects of the proposed fiscal initiatives on domestic and global growth.”

Trump has vowed to dismantle NAFTA, reject the TPP, and impose tariffs on China. In a high-profile move, he intervened in United Technologies’ plan to move jobs in its Carrier division to Mexico, negotiating a $7 million incentives package to keep about 800 jobs in Indiana. But is it realistic to expect all of the manufacturing jobs that have moved to other nations to come back to the U.S.? Most industry experts think not.

U.S. manufacturing productivity is now at the highest level it has ever been, while its workforce shrunk by more than six million jobs from 1980 to 2010. There’s been a slight increase in manufacturing jobs since then, but it’s based on growth in advanced manufacturing which utilizes high-tech, automated processes such as robotics. In fact, the overall U.S. labor force participation rate (LPR) has trended downward since 2010, which could be tied in part to skill sets not matching up to today’s job opportunities, thereby forcing people out of the labor market. (Brian Corde, managing partner of Atlas Insight, explains the low unemployment paradox in our cover story this month.)

So what’s really needed by those who want to work is further education and training. According to the Brookings Institution, “States and regions need to do more to retrain displaced…workers for jobs in expanding industries.” That might be the most realistic solution to the manufacturing job losses and economic woes that have polarized the electorate.

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